Posted on 03/07/2009 11:56:28 PM PST by Chet 99
All Things Considered, March 3, 2009 · Let's say you're one of the millions of Americans facing foreclosure. You made mistakes, borrowed more than you should have — or maybe you lost your job — and now have to walk away from your house. In some parts of the country, simply walking away isn't so simple — especially if the bank doesn't want your house.
At 8:30 nearly every Monday morning, employees from the Cuyahoga County Sheriff's Office stand in a windowless room in Cleveland's Justice Center to auction off hundreds of foreclosed houses.
Hoping to buy are a few investors, bargain hunters and the rare person trying to save his or her house. Most often, it's lawyers from local law firms representing global financial institutions who claim property here. Although these days, that's starting to change.
When there's no bid, the lender can either try to sell at another sheriff sale or do nothing. Doing nothing means the foreclosure is not complete. And Cleveland foreclosure attorney Larry Rothenberg says doing nothing is becoming more popular.
Lenders Not Bidding
"Lately, lenders are finding that the costs to purchase property at the sheriff sale and resell it, and the likelihood of finding a buyer weigh against a decision to buy the property. And so it's become more likely than before that lenders are not entering bids at sheriff sales," Rothenberg says.
That changes the foreclosure equation. Rick Sharga of RealtyTrac says employees at his online foreclosure sales company have heard of other cities where lenders are walking away from foreclosures, and he worries it could spread.
"There are some urban areas where you've had rapid price depreciation, where you also have extreme unemployment issues, and nobody's buying the properties," Sharga says. "All those conditions need to be in place before a lender is going to be motivated to do what you're seeing happen now."
And when lenders don't complete a foreclosure action at a sheriff sale, the house stays in the homeowner's name.
'It's Not My House'
Sharon Little says she was shocked to find out she was still listed as the owner of a rental property on a busy Cleveland street. She walked away from the house in 2006 when she declared bankruptcy. Since then, thieves have stripped the house of siding, copper plumbing, and even windows. She found out her name was still on the deed only when she got a summons last October to appear in housing court.
"Eventually, they're going to tear this house down," Little says. "Somebody's going to have to foot the bill, and frankly I think it should be the bank because it's their house. It's not my house really, so ..."
Begging For Foreclosure
But the city of Cleveland is writing tickets for housing code violations to whomever is listed on the deed.
Bus driver Curley Jackson has been on the phone with his loan servicers trying to persuade them to foreclose on property he can no longer afford.
"I surrendered these properties back to you all. I said, 'You keep leaving them in my name, I'm getting these tickets.' They don't care. They're not getting a ticket. They're not getting threatened with jail," Jackson says.
Cleveland Housing Court officials say they are now seeing homeowners take matters into their own hands. Little, for instance, wrote up a deed and gave her house to her lender.
"That's because it was their house from the jump, so that's what we do — give it right back to them. You can keep your house. I don't want it," Little says.
Untouchable Real Estate
Bankruptcy attorney Richard Nemeth has asked state lawmakers to propose a bill that would force lenders to completely follow through with foreclosure or forgive the homeowner's debt.
"It's a really sad set of affairs when people don't want to touch a piece of real estate with a 10-foot pole," Nemeth says.
County officials in Cleveland hope a new land bank will help solve this problem by giving lenders a place to dump unwanted property. In the meantime, the city is forced to use scarce tax dollars to maintain or demolish some of these unwanted foreclosed houses.
Shark bites, huh? Did you try the compression rings requiring the special tool?
“Wait until the foreclosure sales are for bank buildings that nobody will bid on.”
Yep.
Full disclosure: I'm not a banker, nor have I lost billions of dollars from toxic assets.
;-)
“This is ice, Kent. This is what happens to water when it gets cold.”
Yea, I like that about PVC/CPVC. I’ve plumbed hired man quarters with PVC/CPVC. I just put in air connections and drains so I could blow the lines out with the air compressor at the end of the season.
"Cold"?
;-)
Of course, here in Wyoming, we can plenty of it.
Are you talking about Margaritas?
Okay... but what if you pay the taxes? Not the mortgage, which is an agreement between you and your lender, but just the taxes? The city/county/state/feds wouldn't have any reason to sieze your property. In fact, you could potentially buy the place from the city for back taxes, and own it free and clear.
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